A recent survey by The Nation found most of the developers would turn to debentures to help support their business expansion in 2019. The move would also ease their financial burden from an interest-rate increase expected in the coming months.

“We plan to issue debentures worth Bt12 billion this year, the proceeds of which will go towards repayments of existing debentures due to expire this year as well as business expansion,” Land and Houses Plc’s managing director Adisorn Thananannarapool said recently.

The debenture would maintain its interest rate cost at not over four per cent, he said.

Sansiri Plc’s chief financial officer Wanchak Buranasiri said the company would this month issue three-year debentures worth Bt5.5 billion with a 3.8per cent interest rate under the company’s financial plan. It would also provide funds for business expansion this year.

A Bank of Thailand (BOT) report showed property firms raised capital by issuing debentures in the first nine months of last year worth Bt172 billion, up 19 per cent from the same period of 2017. Up to Bt100 billion of that total were for debentures of longer than one year, while Bt72 billion were for oneyear debentures that will expire in 2019. Thus, all property firms with debentures expiring this year are expected to issue replacement debentures totalling Bt72 billion. New debentures would then need to be issued to support their business expansion for 2019.

“This why property firms will issue additional debentures worth over Bt100 billion this year,” said a bond-market expert.

Meanwhile, the Thai Bond Market Association (Thai BMA) said that most property firms will issue new debentures this year to repay the Bt72 billion worth of bonds that will expire this year. They will also issue new debentures to support their business expansion, amid expectation of a rise in interest rate.

“Issuing debentures will help developers manage their interestrate costs during a period in which the cost of funds will likely rise ,” Thai BMA said.

Debentures that will expire this year are worth a total of Bt568 billion, or about 16 per cent of the Bt3.5 trillion market with property firms accounting for up to 20 per cent of that amount, it added.

Listed property companies plan to invest more than Bt100 billion in land purchases this year for the development of condominiums and low-rise residential projects in Bangkok and the provinces.

Planning for more than Bt300 billion worth of condo, single-detached homes and townhouse projects are being finalised, despite expectations of slower economic growth and the negative impacts from a new Bank of Thailand measure and a rise in interฌest rates.

A recent survey by The Nation found that most listed property firms are continuing to expand their investments in land acquisition for residential development, especially in Bangkok and the provinces withฌin the Eastern Economic Corridor, including Rayong and Chon Buri. All firms surveyed expect to boost sales and to maintain double-digit growth this year.

“We have continued to expand our investment, purchasing land worth up to Bt2 billion, down from Bt4 billion last year,” said Chainid Adhyanaskul, chief executive officer of Property Perfect Plc. “We need undeveloped land for 20 residential projects worth Bt38.4 billion, and expect our group presales to achieve Bt21.6 billion by year-end.”

The company remains confident that real demand in the market will ensure strong growth, especially the demand for housing projects, he said. That optimism prevails despite his awareness of the negative factors this year, including the Bank of Thailand’s new measure to increase loan values for second and third home, which will reduce the demand to buy residential from investors and speculators. Others include higher interest rate, and lower demand for residential property from foreign investors.

“Market growth may decline by up to 10 per cent from last year,” said Chainid. “However that drop will be in the condominium sector, while housing demand for single-detached houses and townhouses will continue to expand. We expect growth of up to 10 per cent in the segment. This is the reason that we have continued to expand our investment.”

He added that growth in demand for residential projects from foreign buyers has continued, though Chinese investors have reduced their overseas property investment due to the US-China trade war. The Chinese government’s latest measure limits capital outflow to no more than US$50,000 (Bt1.652 million) per person.

However, foreign buyers and investors from others countries including Hong Kong, Singapore, and Japan have continued their investments in Thailand’s property market, he says.

“Although the strong baht has caused a 45 per cent rise in the prices of residential properties in Thailand, it remains lower than in other Asian countries such as Japan, Hong Kong and Singapore.

Besides, Thailand is the gateway for business expansion in Asean,” Chainid said.

Supalai Plc’s chief executive officer, Pratheep Tangmatitham, said his company would buy more land and launch new residential projects this year. Supalai sees real demand for residential units in both Bangkok and its suburbs.

“This year, we may face more negative factors impacting the market. However, the country’s economy could still expand by three to four per cent, helping drive demand for residential projects, especially at locations close to the mass-transit system,” Pratheep said.

Demand for property along the routes of mass transit systems also gives confidence to Chanond Ruengkritiya, CEO of Ananda Development Plc.

“Although the industry faces negative impacts this year, we remain optimistic on the demand for condominium projects located close to the mass transit systems,” he said.

Eight of Ananda’s 10 planned launches this year will be condos close to commuter rail routes.

“When the government invests in infrastructure projects, it opens up new locations and markets for our business expansion,” said Chanond.

“People will move their residence to live close to a mass-transit route because it is easy for them to get around. This is our business strategy – to launch our new condominium projects at locations close to the mass transit systems,” Chanond said.

Development requires cement, and Siam Cement Group’s president and chief executive officer, Roongrote Rangsiyopash, sees a bump of up to five per cent in cement demand coming this year compared to 2018.

The drivers of that growth include infrastructure development spearฌheaded by government investment, and from private-sector development of residential and commercial projects.

“We see a five-per cent growth in demand for cement this year, the same rate as last year when compared to 2017, following continued expansion of investments by both the government and private sector,” Roongrote said.

The company also plans to launch 28 new residential projects worth a total Bt46.6 billion this year.

They include 12 condominium projects with a total value of Bt22.4 billion, nine single house projects worth Bt18.7 billion and seven townhouse projects valued at Bt5.5 billion.

The company will focus on medium-priced and affordable market segments, which compose 96 per cent of the total value of new projects in the year. The company has targeted Bt36 billion in presale revenue this year, along with ownership transfer value of Bt32 billion.

This kicks off presale targets of Bt160 billion from 2019 through 2021, Wanchak said.

In line with its business goal, the chief operating officer Uthai Uthaisangsuk says, the company’s 2019 strategy will increase its focus on the in-depth details of what customers need to enhance their living experience.

In light of the changing trends toward health and environmental consciousness among modern people, the company has mapped out a new vision “For Greater Well-Being” and will expand the application of its “green” and “well-being” approaches in all new projects. These approaches will be first introduced at Setthasiri Taweewattana, Sansiri’s first single-home project with the well-being development concept to be launched this month.

Presales for Wellness Residence, Thailand’s first condominium for health-conscious living located in the Krunthep Kreetha area, is set to be launched in the second quarter of the year.

More projects under the Burasiri brand will be developed to cater to increasing demand from those Bangkokians who prefer a resort-style residence. Sansiri is also planning to launch a “dust-free house” for the first time in Thailand this year, and has as well announced proactive measures to reduce the consumption of energy and natural resources throughout the project development process.

“We believed that the Thai real estate market in 2019 continues to grow, with slightly sluggish sales in investment purchases among Thai consumers. However, we believe that the real demand sector will grow on par with last year. More competition in price and project development will give more choices for consumers,” said Uthai.

“Our competitive advantages will bring us another excellent year in 2019, as consumers in the real demand sector prefer to choose a well-established brand with a proven track record in quality and after-sales services.

“We are confident that ownership transfer value will be achieved this year as expected, with strong presale revenue to be recognised from consumers with high purchasing power, especially Chinese and foreign customers who paid a high down payment and are confident in the long-term investment potential of Thai real estate,” said Uthai.

Last year the company recorded total presales of Bt48.5 billion – the highest sales record in its 34-year history. The figure represented 25 per cent year-on-year growth, with Bt14 billion of the presale total coming from foreign buyers, up 51 per cent from 2017.

The company has Bt63.5 billion in current sales backlog of units ready to transfer to customers when projects are completed. The transfers will take place from this year through 2021.

In the first nine months of 2018, Sansiri reported total revenue of Bt17.95 billion to the Stock Exchange of Thailand, with Bt1 billion in net profit, a net profit margin of 5.5 per cent.